Over the last few days there has been much speculation regarding the future of Tesla with the shares now below $300. There was also been mention of a potential offer from Apple, no indication whatsoever from the company, amid a growing view that Apple and Tesla could well be a match made in heaven. So, why is there so much attention on Apple and Tesla?
Elon Musk
Love him or hate, Elon Musk is a man who gets things done goes against the establishment and is not scared to go out on a limb. While his techniques and his strategy are often called into question, references recent battle with the SEC, he does sail close to the wind but very rarely does his boat capsize. As a consequence, there is some comment from analysts suggesting that Elon Musk would have made a far better replacement for Steve Jobs at Apple. Does this make sense?
The reality is that Tim Cook had an impossible mission following Steve Jobs after he passed away. How do you follow a man who never put a foot wrong? Made Apple what it is today?
As a consequence, there are some whispers that Elon Musk would make a far better chief executive officer than Tim Cook. Yes, he may ruffle a few feathers, he may sail close to the wind but Apple is built on innovation and calculated risks. While unlikely to happen, it would have been interesting to see Elon Musk take on the mighty Apple from the helm.
Apple losing direction
The Apple portfolio of “i” products still has many years left in it but there are concerns that the historic premium for the products and the share price are starting to erode. The share price seems to have steadied at the moment but it is well off its high and showing a lack of direction. The company has a multi-billion-dollar warchest but nowhere to invest. Would Tesla fit nicely into the group?
At this moment in time there is growing concern about Tesla’s short to medium term cash flow and funding requirements. While recent cost savings were a reaction to analyst demands, the share price has suffered. Imagine, if Apple was able to take away that short-term concern regarding funding and allow Tesla to simply concentrate on business?
Let the innovators innovate
There is an argument to suggest if you blunt the likes of Elon Musk by crucifying him for every mistake made, you take the edge of the man. This is a man who brought PayPal to the masses, took the helm of Tesla when other founders fell away and has built himself a successful space business. Such is his determination to be successful in business that a divorce hearing just a few years ago heard that while he was a multi billionaire he was cash poor. All of his riches were in shares and he was living off “handouts” from his close friends.
Conclusion
In a perfect world maybe Elon Musk would be the perfect man for Apple but it is quite simply not going to happen. He may be one of the best entrepreneurs in the world, have an ability to see into the future but he does have his faults and they have cost Tesla heavily of late. If you rein in his maverick side then you probably lose the best of his entrepreneurial vision. So, it is fair to say that super entrepreneurs such as Elon Musk do better when they are in control with maybe some trusting ears when they require advice.